On Friday, March 8, 2024, a Texas federal court struck down the newest version of the Joint Employer Standard that the National Labor Relations Board (NLRB) revised in October 2023. The new standard was to go into effect on Monday, March 11, 2024. The Texas court’s ruling has blocked implementation of the new standard, which means the existing standard will continue to be in effect. This lawsuit will continue through the legal process and the new rule may be implemented sometime in the future, although the process will take months, and possibly years, to work its way through the courts.
The new Joint Employer Standard would make it easier for a company to be a joint employer of a temporary employee from a staffing agency or other third-party workforce supplier, and it would require a franchisor to be very careful about interaction with employment issues with franchisees to avoid Joint Employer status. A thorough discussion of the new standard (which is now on hold), can be found here: New NLRB Joint Employer Standard and Suggestions on Avoiding Joint Employer Status.
The current NLRB Joint Employer Standard creates joint employer status only if a company possesses and exercises substantial direct and immediate control over the essential terms and conditions of employment. The current NLRB standard has been in effect since 2020.
For the past decade, the Joint Employer Standard has been revised each time a different political party controls the executive branch. Once the standard is revised, lawsuits are filed in courts that are perceived as friendly to the ideology of the challengers to the revision.
The next step for the litigation will likely be an appeal of the decision by the NLRB to the Fifth Circuit Court of Appeals. Meanwhile, a lawsuit was filed in the Washington D.C. federal courts by a labor union that argues that the NLRB did not expand the Joint Employer Standard far enough. If the D.C. court’s decision in that lawsuit conflicts with the Texas court’s decision, the sorting out of the new standard may be slow and complex. Companies will have more time to adjust to the expanded standard should it ultimately be found legal by the courts and subsequently implemented.
In this article Adriane Harrison, Vice President of Human Relations Consulting, PRINTING United Alliance, addresses a new NLRB rule on the Joint Employer Standard. More information about labor and employment laws and regulations can be found at the Center for Human Resources Support or reach out to Adriane directly if you have additional questions specific to how these issues may affect your business at: aharrison@printing.org.
To become a member of the Alliance and learn more about how our subject matter experts can assist your company with services and resources such as those mentioned in this article, please contact the Alliance membership team: 888-385-3588 / membership@printing.org.